L1 to Invest up to $3bn in the Retail Stars of Tomorrow

LetterOne (L1), the international investment business, announces the launch of L1 Retail, a new retail investment arm. L1 Retail aims to find and develop 21st century retail stars, initially in Europe, including the UK, and in the emerging markets (with the exception of Russia). It will invest up to $3 billion in a small number of retailers that have the potential to become market leaders in their segments and markets.

L1 Retail will focus on companies with customer propositions that reflect value for money and convenience, as well as retailers in the health and wellness areas. L1 believes that a combination of store and online assets, combined with state of the art analytics and logistics, will drive growth in the next 10 to 20 years. Unique business models offering efficient growth platforms and best in class management teams will feature prominently in L1 Retail’s investment choices.

The L1 Retail investment team, which will be based in London, led by Managing Partner Stephan DuCharme, former CEO and current non-executive Chairman of X5 Retail Group, Russia’s largest food retailer, has over 70 years of combined investment and retail sector expertise.

Commenting on the launch of L1 Retail, Mikhail Fridman, Founder of L1 said:

“As entrepreneurs, we have over 20 years built the largest food retailer in Russia. Our aim is to leverage our track record to invest in, and build, the next generation of retailers internationally”. “Current trends in global consumer markets and on-going technological disruptions represent a unique opportunity to build hybrid platforms for growth and value creation in the retail space,” he said.

Commenting on the L1 Retail launch, Stephan DuCharme said:

“We are looking forward to working together with experienced management teams to create new retail leaders. Our long-term investment time horizon coupled with disciplined execution of strategy, and our retail sector expertise, will open up interesting investment opportunities.”

L1 Retail is delighted to announce that John Walden, former CEO of Home Retail Group, and Clive Humby, one of the founders of dunnhumby, have been appointed to the L1 Retail Advisory Board with immediate effect.

John Walden joined Argos as Managing Director in February 2012. His leadership was instrumental in the digital transformation of Argos to become a modern player in its space. He was subsequently appointed Chief Executive of Home Retail Group in March 2014, which included Argos, Homebase and Habitat. John’s executive track record across companies like Home Retail Group, Best Buy and Peapod will guide L1 Retail as it builds leading companies in the retail space.

Commenting on the launch of L1 Retail John Walden said:

“I look forward to being part of something new and entrepreneurial – and to help build a new retail portfolio from the bottom up. The retail market is undergoing constant change. This is creating new opportunities for investors with real retail vision but also the ability to drive disciplined long-term execution of strategy”.

Dunnhumby, created by Clive Humby and Edwina Dunn, transformed supermarkets’ understanding of shopping habits through data analysis and led, among other achievements, to the creation of Tesco’s pioneering loyalty card scheme and a successful joint venture with Kroger in the US. Clive’s understanding of customer behaviour and consumer trends will be of unique value to L1 Retail as it invests in new platforms for growth.

Commenting on the launch of L1 Retail Clive Humby said:

“Understanding customer behaviour and adapting to new trends is the key to success. Data is the new oil. It’s immensely valuable, but if unrefined it cannot really be used. I look forward to working with L1 Retail to identify consumer emerging trends and themes as they invest in new platforms for growth”.

L1 Retail is part of L1, the privately owned international investment business, which was founded in 2013. L1’s aim is to build a world class diversified global investment business. It is a long term investor which invests in sectors where it has specialism – such as the energy, telecoms and technology, health and now the retail sector. L1 owns companies – and has equity investments in companies – with operations in 31 countries around the world. It is actively looking for more investment opportunities.